Court Upholds Satellite Must-Carry Edict

RICHMOND, Va. - In a major set back for digital satellite providers, the Fourth Circuit Court of Appeals upheld must-carry rules for satellite TV, forcing DirecTV and EchoStar to comply with all-or-nothing local station carriage requirements on Jan.1.

The standing must-carry rules require satellite providers to carry every local station in any region the satellite provider chooses to serve with local TV coverage. Previously, the satellite providers had elected to carry only affiliates of major TV networks ABC, CBS, FOX and NBC, with the occasional inclusion of UPN and The WB. Now, they will be forced to add channels, which may carry home shopping networks, religious programming and other content, much of which is already carried by the satellite operators on other channels.

The satellite companies and the Satellite Broadcasting and Communications Association had fought the constitutionality of the must-carry edict, claiming it violated the First Amendment and other provisions.

The Appeals Court opinion said the carry one, carry all rules don't violate either the Constitution and that the Federal Communications Commission's ruling was not arbitrary, capricious or contrary to law.

The SBCA said, 'we are extremely disappointed in the decision from the 4th Circuit Court of Appeals. This is a tremendous loss for consumers and competition in small and mid-size markets because it limits the ability of Hughes' DirecTV and EchoStar's DISH Network to roll out local broadcast service in additional markets.

'The SBCA, DirecTV, EchoStar and the many programmers that support our legal challenge to satellite must carry, are reviewing the details of the decision and will explore all of our legal options.'

The case could eventually be taken to the Supreme Court. Over a week ago the satellite interests had asked for a delay in the January 1 deadline because further litigation was expected beyond that date.